Local Government Policy Council Meets with Governor McAuliffe

The Virginia Association of Counties, the Virginia Municipal League and Virginia First Cities met with Governor Terry McAuliffe and his staff on September 29 to discuss key issues of importance to local government in the upcoming General Assembly session, beginning with an update from the Task Force for Local Government Mandate Review and concluding with a robust discussion among local elected officials about shared concerns.

Governor McAuliffe provided an overview of his Administration’s recent accomplishments, including an agreement on improvements to Interstate 66, enhancements to the school breakfast program, efforts to expand the capacity of the Port of Virginia and work to assist Dulles Airport with retention of its major carriers (the Governor later announced United Airlines had agreed to a long-term lease extension that afternoon).

The Governor reiterated the need to diversify Virginia’s economy and lessen its dependence on federal spending, particularly in light of a potential second round of sequestration scheduled to take place in October 2017. He signaled that Medicaid expansion remains a priority for his Administration, though he indicated that he remains at an impasse with the majority in the General Assembly on this issue.

Secretary of Finance Ric Brown discussed the current revenue situation, explaining that disappointing collections in payroll withholding and sales tax were the largest contributors to the shortfall (See Brown’s Presentation). Although growth in employment was healthy in FY 2016, almost half of that growth was concentrated in lower-paying occupations, which generate less in withholding and provide employees less purchasing power. He suggested that an increase in participation in the freelance “gig” economy may worsen this imbalance. He also speculated that some of the losses in sales tax revenue may be attributable to online purchases, where sales tax owed may or may not be collected. Daniel Timberlake, Director of the Department of Planning and Budget, offered an overview of the process currently underway for state agencies to make spending reductions and outlined the process by which the Governor will assemble his budget amendments, which will be presented to the “money committees” on December 16. He noted that programs providing aid to localities are currently exempt from the requirement for agency spending reductions, but would not promise that they would remain so in the Governor’s upcoming budget.

Secretary of Public Safety and Homeland Security Brian Moran discussed community policing – he applauded local efforts to promote Crisis Intervention Training for law enforcement, attributing recent declines in arrests for minor offenses such as trespassing or disorderly conduct to better training in de-escalating interactions with individuals with mental illness. His office is currently developing a grant application process to distribute federal funding for community-based policing and expects to use the funds to address resources for training, especially in smaller, rural jurisdictions and recruitment and retention of a diverse workforce.

The meeting concluded with an open discussion session, which ranged from the effects of last year’s legislation on proffers to the approaches localities have taken to regulating short-term rentals such as those offered through Airbnb. The need to protect K-12 funding was a common interest. Northern Virginia representatives shared information on expected legislation to amend the compact governing the Metro system and encouraged representatives from other regions to view Metro as an asset to the entire state because it supports Northern Virginia’s economy.